Negotiations between the government and Ngāpuhi appear to have broken down after a meeting between Prime Minister Bill English and iwi leaders.
Two groups within Ngāpuhi - Te Kotahitanga and Tūhoronuku - have different views on who has the mandate to negotiate a treaty settlement on behalf of the iwi.
Mr English met leaders of both factions in Auckland on Saturday night.
In a statement, Te Kotahitanga said the government had 'walked away' from the Ngāpuhi treaty settlement process by removing itself.
Its co-chairs, Rudy Taylor and Pita Tipene, said they were deeply disappointed by the decision and Mr English was naive if he believed he could turn his back on New Zealand's largest iwi.
Mr Tipene said Te Kotahitanga did not have confidence in the leadership of Sonny Tau and Hone Sadler to take Ngāpuhi forward, in spite of Mr English implying they were his preferred leadership team.
However, Mr Tipene said Te Kotahitanga was grateful for the efforts and goodwill of Treaty Settlement Minister Chris Finlayson and his team.
In a statement, a spokesperson for the Prime Minister said the government was confident Ngāpuhi was capable of deciding how to represent itself in treaty negotiations.
The Crown remained committed to reaching a settlement with the iwi and would do so once a negotiator from Ngāpuhi had been finalised.
The spokesperson also said the government offered to fund a mediator for Ngapuhi if they could decide on who that would be and the process to be followed.